Computers, netbooks, smartphones and other consumer electronics devices provide users various software applications. An operating system may utilize an application launcher to provide a starting point for the services or applications that are available to the end user on each device. For example, in some operating systems, the application launcher is a start menu. On many cell phones and smartphones, the initial “start deck” shows icons for launching the applications that complement the basic telephony functions. Even within many service-oriented websites, there is a home page or navigation bar that helps guide end users to the applications and services available from that site. On smartphones or computers, an application launcher might also be an application store from which applications are purchased for installation and later use.
Device manufacturers and service providers have historically negotiated bundling arrangements with software vendors who would be willing to pay for placement of their applications on the application launchers of devices. For example, computer manufacturers get paid by security software vendors to bundle a trial version of security software on a computer, and wireless carriers get paid by interne search providers for placement on the start deck.
However, these ways of placing applications are sub-optimal because device manufacturers must negotiate with each software and service vendor directly. The bundling arrangements are inefficient—a fixed price is locked in for a long period of time (often 12-36 months). Smaller device vendors have a weaker negotiating position and cannot command the “market clearing price” for helping the software vendor acquire a new customer. As a result, the end user experience suffers because the choice of bundled options is not necessarily driven by what provides the best end-user experience. Also, as software evolves and end-user needs change over time, the bundled options and the bounties paid do not change. New entrants are unable to win placement on the start decks of devices that are in service, even if they are willing to pay a bounty for acquiring customers.